Exercise 1

Q1. What is financial literacy in my own words if I had to

explain it to a person it is the understanding of making smart
and efficient choices with your money such as budgeting,
investing.
Q2. This knowledge is needed to stay and be financially stable
in this sense it is very important to have such financial skills.
Exercise 2
 Relative price of one currency expressed in terms of
another currency (or group of currencies
 The government determines a fixed or pegged rate
through its central bank.
 Here are the conversions between the United States
Dollar and some of the Caribbean Territory Differ So,
you can follow along with us and Try and Solve it for
yourselves.
1$ USD = 2$ BDS
1$ USD = 2.70$ EC
1$ USD = 4.25$ TT
1$ USD = 5.50$ Jam
1$ USD = 10.00$ Guy
Exercise 3.14, #’s 1 -15
Using the conversions, we listed above we know that
2 BDS =1 USD so using what we know we just do
1. 40 BSD = $2.00 USD ÷÷ $40.00 BSD
= $20.00 USD

2. $1.00 USD = $2.00 BSD

$80.00 USD = BDS$2.00 x $80.00 USD
= BDS$160.00

3. $1.00 USD = $2.70 EC

$50.00 USD = $2.70 EC x $50.00 USD
= $135.00 EC

4. $1.00 USD = $5.50 Jam

$110.00 Jam = $5.50 Jam ÷ $110.00
= $20.00 USD

5. $1.00 USD = $10.00 Guy

$25.00 USD = $10.00 Guy x $25.00 USD
= $250.00 Guy

6. $1.00 USD = $4.25 TT

$20.00 USD = $4.25 TT x $20.00 USD
= $85.00 TT
7. $1.00 USD = $2.70 EC
$81.00 EC = $81.00 EC ÷ $2.70 EC
= $30.00 USD

8. $1.00 USD = $5.50 Jam

$275.00 Jam = $275.00 USD ÷ $5.50 Jam
= $50.00 USD

9. $1.00 USD = $4.25 TT

$212.50 TT = $212.50 ÷ $4.25 TT
= $50.00 USD

10. $1.00 USD = $5.50 Jam

$75.50 USD = $75.50 USD x $5.50 Jam
= $415.25 Jam
11.
a) $0.60 Can = $1.00 BDS
$60.00 Can = $60.00 Can ÷ $0.60 Can
= $100.00 BDS
b) $1.00 BDS = $0.60 Can
$120.00 BDS = $120.00 BDS x $0.60 Can
= $72.00 Can
12. £1 = EC$4.60.
£100.00 = EC$4.60 X £100.00
= EC$460.00
13. So beforehand he had 460 now, we minus that by 300
because he spent 300 now, we have 160 so the working would
be because we know that EC$4.60 = £1
EC$160 = EC$160.00 ÷ EC$4.60
= This would sum up to approximately £34.78 but
it said to round it up so we would get £34.8 pounds
A. 14. Using the exchange rate given to us we know that
TT$1.00 = BDS$0.48
BDS$500.00 = TT$1.00 ÷ BDS$0.48 * 500.00 =
approximately 1,041.6 it’s a repeating decimal since it
said to give to nearest cent, we round up so we would get
1,042 Trinidad dollars
B. The same formula is applied here but it’s a little different
now we already know the exchange rates so to solve
them we would do.
TT$500.00 = BDS$0.48 ÷ TT$1.00 * 500.00 = BDS$240.00
exactly using the formula we used we found out that
therefore, using the indicated exchange rate, BDS$240.00
is roughly converted into TT$500.00.
 A. 15. Here is the table provided for you to guide you along
with us

Country Currency Notation

U.S.A. The U.S. dollar US$
England The great British GDP£
pound
Canada The Canadian Can$
dollar
France The Euro €EUR
Venezuela Venezuelan Bolivar
BS.
Antigua and The Eastern EC$
Barbuda other Caribbean dollar
Caribbean
territories as well
Kuwait Kuwaiti Dinar KWD
Switzerland and Swiss franc CHF
Liechtenstein

Notation for Venezuelan bolivar is Bs.

Nederland’s Antilleans guilder unfortunately the symbol is not

in word document for me but it’s a slightly slanted F.
The notation for it is NAF.
Here is the current exchange rate as of May 13th, 2023.
1. 50 guilders = US$27.85
2. 50 guilders = GDP £22.34
3. 50 guilders = Can$37.70
4. 50 guilders = EUR €25.46
5. 50 guilders = Bs. $68,883,500
6. 50 guilders = EC$75.26
7. 50 guilders = KWD$ 8.55
8. 50 guilders = CHF$ 25.01

B.
1. US$20.00 = NAF 36.05
2. GDP£20.00 = NAF 45.12
3. CAN$20.00 = NAF 26.70
4. EUR€20.00 = NAF 39.21
5. BS.$20.00 = NAF 0.0001
6. EC$20.00 = NAF 13.34
7. KWD$20.00 = NAF 117.50
8. CHF$20.00 = NAF 40.30
Once it’s all added up, we got a surprising total of exactly NAF
318.2201 But the question asked us to round to the nearest
cent so we would get a total of NAF 318.2

D)
1) When visiting a foreign nation, it is typically recommended
to use both a credit card and a debit card. Credit cards provide
fraud protection and are frequently used. Additionally, they
frequently provide better exchange rates and rewards
schemes. However, certain establishments might not accept
credit, so having a backup plan is essential. For modest
purchases or locations that don’t accept credit cards, debit
cards can be used to withdraw cash from ATMs in the local
currency. They might not offer the same fraud protections as
credit cards, and they might charge for foreign expenses.
Before you go it's crucial to confirm that your credit cards will
function in the destination country with your bank and credit
card provider.

2)
i)
Bring several credit cards with no foreign transaction fees.
Chip and pin support, and other features.
Contact your credit card provider.
ii)
The currency exchange of the destination country.
Avoid unwanted additional costs.
Carrying large amounts of cash
iii)
We would suggest that you ask the locals what the original
price is.

Exercise 3
(A)
1. For this exercise, the bank we've selected is Windward
Island Bank (WIB), also known as WIB. Here are the
account options that the bank offers, according to its
website as of this writing.

1. Current Account
2. Savings Account
3. Youth savings Account
To explain one, we chose a current account.
It is a bank account made for regular activities like paying
bills, writing checks, and using debit cards to make
purchases. These accounts frequently come with
amenities like check-writing rights, online banking, and
ATM access.
(B) A college student Named Sarah wants to open an
account so she may start saving money and perhaps even
making more. She compares Windward Island Bank's
(WIB) current account, youth savings account, and
 savings account to see which one is the greatest fit for
her.

Here is the example at hand We decided to use.

When Sarah looks at the features of the current account, she
discovers that it gives her quick access to her money for daily
expenditures. She learns, however, that there aren't many
opportunities to make much income with this account. Sarah
understands that a current account would not be the best
option for optimizing returns on her investments given her
desire to earn more money.

The Youth Savings Account, created for young people like

herself, is also reviewed by Sarah. She learns that the interest
rates for this account could not be as high as other savings
accounts, even though it promotes saving habits and might
provide some benefits specific to young people. After
weighing the potential rewards, Sarah decides she wants to
investigate other possibilities.
Sarah investigates the savings account that WIB is providing. It
enables her to save and deposit money while generating
interest on her account balance, according to her. When Sarah
discovers that savings accounts often pay greater interest rates
than current accounts, she understands that this account is
better suited to achieving her objective of increasing her
funds. She checks the conditions, interest rates, and any
additional costs for WIB's Savings Account to make sure they
satisfy her needs.

Sarah's study leads her to the conclusion that the WIB Savings
Account is the best option for her. In comparison to a current
account, it provides the possibility of higher interest returns
and a designated savings vehicle to support her in achieving
her financial objectives.
In the end Sarah chose a Savings account as the best one for
Her.
(C) Personal Loans: Personal loans are frequently taken
out to cover a variety of needs, including debt
consolidation, home renovations, and unforeseen costs.
They are unsecured loans that let borrowers get a big
sum and pay it back with interest over a predetermined
time frame.
Home loans: usually referred to as mortgages, are used to
fund the acquisition of real estate. They may offer fixed
or adjustable interest rates and typically have longer
repayment durations.
Auto Loans: A vehicle can be purchased with the help of
an auto loan.
 (D) Personal loans: They give borrowers flexibility in
terms of utilization and can be applied to a variety of
things, including consolidating debt, making home
modifications, paying for expensive medical care, or
making large purchases. Personal loans often have fixed
interest rates and specified payback terms and are
unsecured, meaning they don't require collateral.

Personal loans are frequently chosen by people who

require money for a variety of reasons because of their
adaptability and accessibility. It's important to keep in
mind, though, that the popularity of different loan kinds
might change depending on factors including regional
preferences, prevailing economic situations, and
particular borrower demands. Depending on the unique
situations of the borrowers, other loan kinds, such as
home loans/mortgages and auto loans, may also be
heavily utilized.
Exercise 4
Investing in a variety of different assets is one of the best
strategies to minimize risk and increase rewards. You can
lessen the effects of any specific investment that doesn't
perform as well as anticipated by investing in a variety of
assets.
One feasible plan of action would be to open a high-yield
savings account with a commercial bank to optimize the
returns on the $500 investment. In comparison to standard
savings accounts, high-yield savings accounts often provide
higher interest rates. Here is how this tactic might be put into
practice:
Find commercial banks that provide high-yield savings
accounts with competitive interest rates by doing research on
high-yield savings accounts. Look for accounts that do not
require a minimum balance and have reasonable fees.
Consider elements like the interest rate, the frequency of
compounding, and any promotional offers.

Compare interest rates: Learn about the interest rates that

various banks are offering. Select the bank with the best
interest rate. Consider the case where Bank A offers an APY
(Annual Percentage Yield) interest rate of 2.5 percent.
Open a high-yield savings account: Go to the chosen bank and,
with the $500 deposit, open a high-yield savings account.
Review and comprehend the terms and conditions, including
any withdrawal limitations or additional costs.

Determine interest: Apply the equation A = P (1 + r/n)(nt),

where:
A: The investment's future value, including interest.
P: the initial investment's principal sum
r: The yearly interest rate (in decimal form)
n: The frequency of annual compounding of interest
t: The length of time that money is invested.
Let's calculate the future value after a year using a 2.5%
interest rate, assuming that interest is compounded annually.
APY:
A = $500(1 + 0.025/1) ^ (1*1) = $512.50

Reinvest and monitor: Keep track of any changes to the

account's interest rate or any special offers. Consider moving
the cash to a different bank or investment choice if there are
better opportunities.
In this case, the index fund would have a one-year return of
$535 whereas the high-yield savings account would have a
return of $512.50. Therefore, the index fund would produce
more returns than the high-yield savings account in terms of
pure returns.

The market can always fluctuate, so it's vital to keep in mind

that investing in an index fund entails some risk. On the other
hand, the high-yield savings account offers a more secure and
low-risk choice for protecting the principal amount while
receiving some income.

When choosing between various investing options, it's

important to consider elements like risk tolerance, financial
goals, and the time horizon for the class trip.
5. Based on the research we had to do that was at hand for
the budgeting of our end of year trip here’s an outline of
how much everything cost, and the total will be stated
below for you Ms. Baker

Airline Tickets
We averaged the costs of all the flights, and we found that
the average airline ticket to Puerto Rico range Rico ranges
from $196 – $231 USD.
Accommodation
The cost of a hotel room in Puerto Rico per night was
between $128 USD.
Meals
In Puerto Rico, the average cost of a lunch is roughly $40
USD.
Transportation
Around $26 USD was spent on a rental car to get to the
attractions Across Puerto Rico.
Entertainment
 To enjoy yourself and have a wonderful time in Puerto
Rico, it costs $46 USD per person.

We are happy to share the websites we used to compile

the data we gave for you today to help us answer
question 5, Miss Baker. When you see this message, we
hope you enjoyed our project and wish you a nice day.

1. https://www.budgetyourtrip.com/puerto-
rico#:~:text=Average%20Daily%20Costs,-Calculated
%20from%20travelers&text=While%20meal%20prices
%20in%20Puerto,cheaper%20than%20lunch%20or
%20dinner.
2. https://www.expedia.com/Cheap-Flights-To-Puerto-Rico-
Island.d180021.Travel-Guide-Flights
3. https://www.kayak.com/Puerto-Rico-
Hotels.47547.hotel.ksp#:~:text=How%20much%20does
 %20a%20hotel,The%20average%20price%20is
%20%24128.
4. https://www.budgetyourtrip.com/puerto-
rico#:~:text=Average%20Daily%20Costs,-Calculated
%20from%20travelers&text=Entertainment%20and
%20activities%20in%20Puerto,tours%2C%20and%20other
%20sightseeing%20expenses.